For the past couple of weeks, we’ve been covering the concept of Bitcoin and why it came to be. As a brief review, Satoshi set about creating bitcoin with the goal in mind that two complete strangers could conduct a monetary electronic transaction without the need for a central authority to authenticate the transaction.

Although it fell short, so far, of its original goal (who buys a soda and a pizza with bitcoin?), it has more than found its niche as a digital store of value. Its simplicity and limited supply make it analogous to digital gold.

But, although bitcoin itself doesn’t get used so much in daily transactions, it spawned other, alternative coins (alt coins) that are better suited to certain types of transactions.

One alt coin that does have transactional utility is Ethereum. While Bitcoin enjoys first mover’s advantage, Ethereum has steadily risen in importance to where it is now another primary cryptocurrency, with a second place market cap of nearly half of Bitcoin's.

In some ways, ETH is dramatically different than BTC. We don’t know for sure who invented Bitcoin, other than by his given name. With Ethereum there aren’t such secrets. Vitalik Buterin created Ethereum at the ripe old age of 20, along with a few other developers.

Bitcoin’s scripting language is limited in functionality by design. Ethereum on the other hand, is designed to perform all kinds of different functions, and unlike the set and forget nature of Bitcoin, Vitalik is one of the primary decision makers as to where Ethereum is headed.

Another major difference between Ethereum and Bitcoin is how they came to be. When Bitcoin was introduced nobody yet knew how valuable each coin would become. Bitcoin’s early adopters were strong believers in the technology, and weren’t as concerned about the price. By the time Ethereum came around, capital appreciation was front and center.

Bitcoin had no initial distributed sale, and has a hard limit of 21 million coins in existence. Ethereum’s introduction was a bit different, with the sale of pre-mined coins. People could initially swap 1 Bitcoin for 2000 Ether (which, it turns out, was one of the better trades in history, currently standing at 1:14). To this day, there is no limit to how much Ether can be redeemed, and no hard limit on how many can be in existence.

It’s fair to say that Ethereum has completely changed the entire cryptocurrency world. Previously, people associated crypto as just a means to transact and make payments. A way to send money from wallet A to wallet B securely. In this way, Bitcoin is similar to its analog cousin—gold. Like bitcoin, gold has a limited number of uses, and a primary use is its consistent store of value.

If bitcoin is analogous to gold, Ether is more like digital oil. We’ll get a bit more into the weeds in the next Ethereum post, but suffice it to say, they are fundamentally different, and both have their place in this world.

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